I think showing and hiding panels is perfectly acceptable for a very small number of panels.  Another option is to use only dynamically-created controls in your module. 

I think the answer you're looking for, though, is to dynamically load different user controls within the module as needed.  This approach can be beneficial for a number of reasons (for instance, when you have a large number of different interfaces) but it can also require much more coding in terms of maintaining / sharing data between different dynamically-loaded controls.  You also have to implement your own security if any of your loaded user controls is an "admin only" control (such as for module settings).

More reading:
http://74.125.93.104/search?q=cache:jD8V1F1IeRkJ:www.dotnetnuke.com/Community/Blogs/tabid/825/EntryId/1462/Dynamic-controls-postbacks-and-view_state-data.aspx+dnn+dynamically+load+user+control&cd=2&hl=en&ct=clnk&gl=us

http://www.dotnetnuke.com/Community/Blogs/tabid/825/EntryId/1242/Dynamically-loaded-user-controls-ascx.aspx

http://www.apptheory.com/dotnetnuke/dotnetnuke_blogs/ctl/articleview/mid/1002/articleid/308/setting-localization-on-a-dynamically-loaded-user-control-in-dotnetnuke.aspx

Good luck-
-mamlin